Close coupled catalysts (CCC) significantly improve emission control in cold start and during warmup. Under heavy load operation, however, they can reach temperatures that can affect the durability of the catalyst. Therefore, it is desirable to bypass the CCC under heavy loads or preferably at all times except in cold start and warm-up. The packagability of such a device, however, is very difficult. The purpose of this invention is to provide the most compact arrangement of a catalyst and a valve-controlled bypass passage.